NEW YORK, Jan 22 (Reuters) - Hughes Electronics Corp. said on Wednesday it has no plans to merge PanAmSat and Hughes Network Systems following a published report suggesting the link would accompany the sale of its DirecTV unit.
The comments come as Hughes tries to work out its own future after EchoStar's failed takeover attempt of the company last year. Hughes owns satellite TV company DirecTV, which it is trying to sell, and 81 percent of satellite operator PanAmSat,
"No plan is being drafted to merge PanAmSat and Hughes Network Systems. However, Hughes is always reviewing its options," Hughes spokesman Richard Dore said.
Dore was responding to a Wall Street Journal article on Wednesday that said Hughes Chief Executive Jack Shaw is developing a plan to keep PanAmSat as a separately owned entity and integrate Hughes Network Systems, which sells television set-top boxes.
PanAmSat would not comment on the story.
One analyst suggested that the notion could be part of the tactics involved in clinching a DirecTV sale but he was concerned about how the tie up would affect PanAmSat.
"We view a potential merger between (PanAmSat) and HNS as more of a concern than a positive," Lehman Brothers analyst William Kidd said in a research note.
"The combination would convolute (PanAmSat's) investment story and transform a safe business into a risky one."
Kidd was concerned that a merger would allow Hughes to use PanAmSat cash to support Spaceway, a satellite venture that Hughes plans to launch commercially at the start of next year.
Hughes owner General Motors , which said it hopes to disclose its intentions for Hughes ownership in two to six weeks, has said that possible options could include strategic investors, equity partners or maintaining ownership of Hughes.
Although the company has not disclosed specifics Rupert Murdoch's News Corp has made no secret of its desire to add DirecTV to its global satellite services network.
PanAmSat stock was up 9 cents at $14.75 in afternoon trading on Nasdaq while Hughes stock was up 4 cents at $10.89 on the New York Stock Exchange.